Credit union savings up to €10bn

SAVINGS at the country’s 532 credit unions have reached nearly €10 billion, according to the movement’s governing body.

The Irish League of Credit Unions (ILCU) said members’ savings last year grew by 17% with overall assets rising by 12% to €11bn.

According to its annual report, the ILCU advanced 6bn to customers in 2003, a 6% increase on the previous year. The average loan to customers was almost €7,000, and 37% of its loans were under €750.

ILCU chief executive Liam O’Dwyer said this highlighted how important the credit union movement was to the lives of ordinary people and that the traditional finance houses were not serving communities as well as credit unions.

“We have a very substantial number of smaller credit unions who are serving rural and disadvantaged communities, run by volunteers who are doing a great job.... that is an excellent service, particularly when you consider that so many other financial service providers are moving out of those areas.”

He said higher interest rates and dividends to members were the reasons for the growth in its customer numbers. Membership grew by 4% in 2003 and now stands at €2.7 million.

Following three years of internal turmoil, caused by the €34 million loss it made over the bungled installation of new technology, Mr O’Dwyer said the movement was now in much better shape.

Following the scrapping of the ISIS system, the ILCU commissioned a report by industrial relations negotiator Phil Flynn, which recommended nearly 60 changes to its structure and working practices.

“Phil Flynn will make a final report to our consultative general meeting at the weekend. It will be a positive report and vast bulk of recommendations of the review have been implemented. Things are looking good and there has been substantial change and it has been widely respected by members,” Mr O’Dwyer said.

Mr O’Dwyer believes the credit union movement has not been damaged by this and other incidents in various credit unions.

“Each credit union is an individual entity. There will from time to time be difficulties in any [credit union] as in any voluntary organisation. No one has lost money in any of those credit unions and there are no financial irregularities.”

Mr O’Dwyer said the league has been more progressive in the past year and has introduced its new PEARLS system to test for any financial weaknesses in individual credit unions.

The ILCU also plans to appeal a finding by the Competition Authority that the league breached competition law by not allowing some members (who had been disaffiliated from the league) savings protection, to the High Court.